Parkinson, who played 164 league games for Tranmere and had spells with Sheffield United, Notts County and Grimsby, joins for the rest of the season.
The winger who only scored twice in 27 appearances for Cambridge United played in the League Cup Final of 2000 as Leicester beat Tranmere 2-1.
After just one appearance for Cambridge the 30 year-old suffered an anterior crutiate ligament in training and was ruled out for the rest of the 2007/08 season.
After a quick comeback Parkinson found his contract cancelled by Cambridge on February 1st.
In a somewhat shock decision Darren Williams has been let go by Ian Bogie, despite having signed a contract for the rest of the season only two months ago.
The former Sunderland defender had been played out of position for most of his appearances, being stuck in midfield and later at right back to replace Craig Baxter.
It was no wonder then that Williams couldn't get any form, and conceding a penalty which gave Hayes and Yeading their winning goal on Saturday was his final contribution to the team.